OTTAWA — Chris Severson-Baker, Executive Director of the Pembina Institute, made the following statement in response to the 2023 Federal Budget:
“The 2023 Federal Budget sends a clear message that Canada is committed to building a cleaner future. We were pleased to see investments that support the development of the low-carbon economy, while also creating good, long-term jobs for Canadians.
“This budget makes Canada competitive with the U.S.’s Inflation Reduction Act and Europe’s Green Deal Industrial Plan, in terms of investment in climate. It ensures Canadian workers can benefit from the significant economic opportunities presented by clean electricity, energy efficient building retrofits, zero-emission vehicle manufacturing, and the production and refining of critical minerals.
“We were especially pleased to see the inclusion of investments in clean electricity, clean technology manufacturing and adoption, carbon capture, utilization and storage, and infrastructure, which will lay the groundwork for low-carbon industrial investment in Canada and will provide the funding, infrastructure and capacity needed to decarbonize everything from buildings to transportation to energy production.
“This is a pivotal moment for the world’s economies. The opportunities presented by the clean energy economy are significant and Budget 2023 positions Canada to be able to take full advantage by supporting investments that help us build a clean economy that is made-in-Canada.
“We look forward to working with the federal government, the provinces, labour organizations, industry and groups like the Green Budget coalition — of which we are a member — to build strategies that take full advantage of the investments made in this year’s budget. We anticipate these investments to help reduce emissions, ensure the creation of good, safe and inclusive jobs that can be accessed by all Canadians, and centre Indigenous interests to ensure they can directly benefit from the opportunities in clean energy and infrastructure projects these investments create.”
Budget 2023 Highlights
Clean electricity: We are pleased to see investment in clean electricity — it is pivotal to national economic interests as Canada competes for low-carbon investment. It also increases affordability for all Canadians by reducing their reliance on increasingly expensive fossil fuels. This item is a calling card to the rest of the world for low-carbon industrial investment in Canada. In particular, the investment tax credit for clean electricity will support the clean grid of the future, one that is sustainable, secure and more affordable. It will help improve reliability and provide the grid capacity needed to decarbonize every other major industrial sector, while taking steps towards the scale of clean energy investment in the United States.
Investment tax credits for clean technology manufacturing and adoption, and clean hydrogen: These will support clean electricity including renewables, energy storage technologies, abated gas transmission and zero-carbon hydrogen. We are pleased to see Canada take strides to catch up with its peers, by incentivizing investment opportunities in the provincially regulated electricity markets. Ensuring these opportunities also extend to community-owned renewable energy projects for remote and Indigenous communities will be essential.
Following through on carbon capture, utilization and storage (CCUS) investment tax credit (ITC) and the Canada Growth Fund: When the CCUS ITC is stacked with credits from Canada's carbon pricing systems and Clean Fuel Regulations, investment decisions for many CCUS projects will now have the funding they need to progress at pace. When the government follows through with carbon contracts for differences (CCfDs) this will increase certainty around the carbon price, further supporting investment decisions for CCUS projects.
Electric vehicle (EV) supply chain and manufacturing: Funding for EV supply chains through the clean technology manufacturing tax credit will help Canada build the growing number of EVs we will see on our roads and around the world. We see this additional support as a step towards a more comprehensive industrial strategy to ensure Canadians and Canadian manufacturing can realize the full economic benefits of the zero-emission vehicle (ZEV) transition.
Critical minerals: Critical minerals are a cornerstone to creating a made-in-Canada clean energy economy, and this investment capitalizes on Canada's natural advantages in this sector. They will underly the entire development of clean energy infrastructure and use because they are essential to every aspect of powering the clean economy. Life-cycle management of these minerals and creating a circular economy for them will be key to making this industry sustainable.
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Contact
Karen Garth
Senior Communication Lead, Pembina Institute
403-890-5778
Background
Report: Green Budget Coalition Recommendations for Budget 2023
Report: Comparing Canadian and American Financial Incentives for CCUS in the Oil Sector
Blog: Canadian oilsands don’t need more public support to compete with the U.S.
